Opinion AGO 11-704.

• Case Date: December 24, 2012
• Court: California

California Attorney General Opinions 2012. Opinion AGO 11-704. TO BE PUBLISHED IN THE OFFICIAL REPORTSOFFICE OF THE ATTORNEY GENERAL State of CaliforniaKAMALA D. HARRIS Attorney GeneralOPINION of KAMALA D. HARRISAttorney General DANIEL G. STONE Deputy Attorney GeneralNo. 11-704 December 24, 2012THE HONORABLE MARTY BLOCK, MEMBER OF THE STATE SENATE, has requested an opinion on the following question:When a county treasurer serves as the treasurer of a public cemetery district, must the governing board of the cemetery district obtain the county treasurer's approval before it may invest its endowment care fund and surplus endowment income funds outside of the county treasury?CONCLUSION When a county treasurer is serving as the treasurer of a public cemetery district, the governing board of the cemetery district may invest its endowment care fund and any "surplus" or "idle" endowment income funds in the manner prescribed by statute without the county treasurer's approval. ANALYSIS This question concerns a public cemetery district's investment authority with respect to two kinds of monetary deposits for which it is responsible-the district's "endowment care fund" and its "surplus endowment income funds." We are asked whether the governing board of a district wishing to invest those funds outside the county treasury may do so without first obtaining the county treasurer's consent, when the county treasurer is also acting as the district's treasurer. The question arises because, we are told, some county treasurers are reluctant to carry out cemetery districts' instructions to invest their surplus funds outside of the counties' own investment pools. In a December 2009 opinion, we addressed a similar question involving the investment authority of a fire protection district when the county treasurer also serves as the district's treasurer. We concluded that a fire protection district in that situation "may invest its surplus funds outside of the county treasury without the county treasurer's approval."(fn1) However, we emphasized that our conclusion was based on the specific statutes governing fire protection districts, noting that the investment powers of other kinds of special districts, as well as the particular roles, if any, played by the county treasurer and district treasurer with respect to such investments, could not be ascertained without an analysis of the specific statutory framework that defines each district's mission and authority. We said:

In the case of other special districts, the need for county treasurer approval of such investments depends on whether the governing statutes for those districts specifically require approval either by the county treasurer acting ex officio or by the district treasurer when one has been appointed by the district board.(fn2)

Here, we consider the statutes governing public cemetery districts.

Public Cemetery Districts Public cemetery districts are independent special districts(fn3) formed pursuant to the Public Cemetery District Law ("District Law")(fn4) for the purpose of owning and operating public cemeteries to provide respectful and affordable interments.(fn5) Each public cemetery district is governed by a board of trustees consisting of three or five registered voters in the district who are appointed by the county board of supervisors and who serve staggered four-year terms.(fn6) In addition to owning, maintaining, managing, and improving cemeteries within their boundaries, districts may sue and be sued; purchase and sell real and personal property; adopt ordinances, rules, and regulations; enter and perform contracts; borrow money; hire employees; train trustees; engage professional services; provide insurance; enter joint-powers agreements; appoint advisory committees; and take any actions necessary for or incidental to the exercise of these powers.(fn7) In matters of finance, a public cemetery district receives a share of its county's annual property tax revenue;(fn8) it may accept grants, goods, money, property, revenue, or services from specified sources for permitted purposes;(fn9) and it is authorized to levy special taxes,(fn10) incur bonded indebtedness,(fn11) sell interment rights,(fn12) and charge fees for district services.(fn13) It is required to adopt an annual budget;(fn14) it may establish one or more restricted reserve funds;(fn15) and it is required to create an "endowment care fund,"(fn16) the principal of which may not be spent(fn17) but is to be invested and reinvested in prescribed securities, obligations, certificates, and accounts.(fn18) A district must provide regular audits of its accounts, its records, and its endowment care...